GST law to be clarified

The Government will introduce legislation to clarify GST law covering payments imposed by local authorities under the Resource Management Act, Revenue Minister Michael Cullen said today.

He said local authorities could seek financial contributions from applicants for resource consents if the development work required new infrastructure under district plans.

"These financial contributions should be subject to GST, in the same way that resource consent application fees are," he said.

"Although most local authorities have treated financial contributions in this way, the law on this point is not entirely clear.

"The proposed legislation will clarify that they do indeed attract GST."

Dr Cullen said the change would be included in a taxation bill already introduced to Parliament.

- NZPA